Nations are the basic component of the roleplay. The main units of political interaction, they are the means by which many will establish themselves. Running one easy, comparatively speaking, to say organizing an alliance or starting a corporation, but should not be regarded as an option for the simple. Nation-running has plenty of its own complexities you’ll need to understand, explained en detail below.

Taxation:

Spoiler:

In order to run your government, you require money derived from taxes. The majority of the money you take in will likely be income taxes, but there is certainly room to tax the sales of corporations based in your nation. For the moment, income taxes:

Income taxes are fairly simple. You take the income per worker in your nation (base 200 kerbits/kerbal) and multiply it by the number of workers in your nation (see demographics center). What this results in is your Gross National Income, the sum of all incomes in your country. You take this value and multiply it by your tax rate to find what part of that goes to your government. Expressed in an equation below -

y = (xn)t

Wherein y is the tax income, x is the number of workers, n is the pay per worker, and t is your tax rate.

So, if you had 500 thousand workers, they were each paid 200 kerbits per cycle, and you taxed their income by 20%, you would find yourself with the following:

Now, that may seem like a pittance, but that’s where you have two options -

1. Raise taxes - You are allowed to raise taxes to a certain limit, depending on your economic type:

Maximum tax rates:

Capitalism - 25%Mixed - 50%Socialism - 75%Communism - 100%

2. Construct Infrastructure - You may use the next section, constructing infrastructure, to raise the wages of your people and earn more money from taxing their new wealth.

Infrastructure:

Spoiler:

Nations require infrastructure to operate, be it basic dirt roads, to massive airports, stock exchanges, and highway systems. Every infrastructural project you undertake (see Standard Projects) gives your nation bonuses and penalties, amplified by whichever national focus you decided on. You construct this infrastructure as a project, using PP points (project points) and money to get them done. What they do to you as a nation depends on what you construct. For instance, certain technological trees require certain buildings in order to be researched, and other buildings allow you to extend your influence in the militaristic means.

Of course, the level of development you chose when registering your nation decides what infrastructural buildings you start out with (see Development Levels). Those who decided to start at Median Development levels have the following buildings pre-constructed -

These all provide various bonuses to your nation, but they also come with a maintenance cost that must be paid or their effects will not be applied to your nation.

For instance, the Municipal Power Grids project costs 5 MK/cycle on its own, added to the maintenance costs for the individual power plants (5 power plants per million kerbals). Each power plant costs 0.5 MK per cycle to maintain. Therefore, the total cost to maintain electricity access to your municipalities is 7.5 MK per cycle with a population of 1 million.

If you cannot afford to pay that, or choose not to, you lose the bonus that Municipal Power Grids provides, which is a 10% PP bonus and +100 kerbits to the worker income.

The same rules apply to all projects that have non-fluctuating maintenance costs. Those that fluctuate do not do so randomly, but rather are decided by you, the nation owner.

For instance, you can decide your Education and Healthcare spending, with bonuses for spending more on those areas. As a Median Development nation, you are required to spend 20 kerbits per child in the State Education System, which gives you a 6% reduction on the PP cost to research techs, adds 30 kerbits to your worker income, and gives a 4% PP bonus. That may seem small, but that’s because of the minute funding going into the system. If one were to spend the maximum amount, 100 kerbits per child kerbal, then the bonus is extended to the maximum of 30% research bonus, +150 kerbits to worker income, and a 20% PP bonus.

For more information on the specific projects, please see the Standard Projects thread.

Any of the standard projects could also be built and run by corporations. The nation still receives the bonus, but it would be up to the corporation to decide how much they want to fund the system, and how much money they get out of it (see Corporations for more information).

The Corporate World:

Spoiler:

Nations cannot escape the corporate universe, which include everything from service corporations to military contractors. What matters to a nation, however, is the money they get out of it, and how to get more of it.

There is, of course, the classic sales tax that can be applied to all sales made by corporations based in your nation. You are at liberty to apply any sort of tax on corporations you so choose, just keep in mind that the more you tax corporations, the fewer number of corporations may be willing to establish themselves in your nation or do business there.

The most important aspect, however, is controlling your development. Always keep in mind that every increase to the worker income you create with development projects is more money that a corporation will have to pay to its workers there. Therefore, having a highly developed country will not be conducive to hosting Primary and Secondary corporations, which require many workers to produce their materials and therefore would be looking to base themselves in regions where labor costs are low.

However, certain types of corporations, namely Tertiary and Quaternary corporations (such as those that would build and run hospitals/universities/sell electronics), cannot exist in places below a certain level of development.

Therefore, it is important to decide what type of economy you would like to have, lest you risk stagnating while other countries use corporate hosting to their advantage.